BHEL bags ArcelorMittal equipment contract for Ukraine plant

NEW DELHI: State-run BHEL today said it has bagged a Rs 40 crore contract to supply equipment for a captive power plant being set up at global steel giant ArcelorMittal's plant in Ukraine.

BHEL has bagged the contract for supplying the steam turbine generator (STG) package for the captive power project at ArcelorMittal Group's steel plant at Kryviy Rih, in Ukraine, an official statement said.

BHEL's scope of work under this contract involves design, engineering, manufacture, supply and supervision of the erection and commissioning of the 27-MW steam turbine & generator package, including controls and instrumentation (C&I).

The project is to be executed by BHEL within a contractual completion deadline of 18 months. The steam turbine generators and C&I systems are to be manufactured at BHEL's Hyderabad plant and its electronics division in Bangalore, respectively.

Up to June, 2011, BHEL had installed generation equipment with a cumulative capacity of over 8,500 MW in 21 countries outside India, while another 5,200 MW of power generation capacity was under various stages of execution in 19 countries.

BHEL has also set up a marketing office at Almaty, in Kazakhstan. The company has executed many contracts for various products and services in Russia, Azerbaijan, Kazakhstan and Tajikistan.

Presently, the company is executing a gas turbine-based combined heat and power plant project in Belarus.

Anil Ambani-promoted Reliance Infrastructure can collect toll at 10 projects by March

NEW DELHI: Anil Ambani-promoted Reliance Infrastructure can start toll collection at its 10 road projects, which are being implemented at an estimated investment of Rs 10,000 crore, by the end of this fiscal.

"Six projects of Reliance Infrastructure would become revenue operational by March, 2012, four have already started generating revenues," a source said.

The company is executing these projects of the National Highways Authority of India under the public-private- partnership model and would earn revenue from toll collected from traffic.

In these six-laning projects, tolling can be commenced parallel to the commencement of construction from the day financial closure is achieved.

These projects include six-laning of NH 4 between Pune and Satara of length 140 km in Maharashtra, six-laning of NH 7 between Hosur and Krishnagiri of length 60 km in Tamil Nadu, six-laning of NH 2 between Delhi and Agra of length 180 km in Haryana and Uttar Pradesh.

Once these projects are completed, they are likely to generate a revenue of Rs 1,200-1,400 crore per annum.

Reliance Infrastructure plans to bag more highway projects in the future.

"Themega road projects...whenever they are bid out RInfra would been keen to develop them....only one mega road project has been bid out so far," sources said.

The 10 projects would be fully-commissioned by 2014. Reliance Infrastructure has 25 infrastructure projects totalling Rs 40,000 crore in hand, including these 10 projects.

The company had posted a net profit of Rs 362 crore in the quarter ended September 30, 2011.

GMR infra may face lawsuit over male airport user fee

BANGALORE: GMR Infrastructure, which is building Maldives' largest airport, the Male International Airport, could face a funding shortage of $25 million annually, after reports emerged that a local political party - Dhivehi Qaumee Party (DQP) - may file a case against the Bangalore-based company for collecting airport development charges (ADC).

GMR Infrastructure plans to charge $25 per passenger from the annual departing passenger count of one million, and wants to introduce a $2 insurance charge at the check-in counters starting January to offset the costs incurred in building the airport.

"The local opposition party is alleging that the ADC should be removed. However, GMR has mentioned that as per the terms of the airport agreement, it will be allowed. The company is looking to fund $25 million per annum for its capex plan of $511 million," said a person close to the development.

The company had earlier tried to include ADC within the airline ticket price itself, but the International Air Transport Association (IATA) didn't allow it.

DQP vice-president Imad Solih has already submitted a separate civil case, questioning the legitimacy of the charge, and has requested the court to take action against the country's finance ministry, according to a report by Haaveru Online, a local website.

"ADC at Ibrahim Nasir International Airport, Male, is a charge approved by the Government of Maldives and we will implement the same in due course of time. As of now, we have no official intimation of the same and thus, would not like to comment on speculative news," a GMR spokesperson said.

In June last year, the GMR-led consortium won a bid to build, operate, modernise and expand the Male airport for a period of 25 years, from the Maldives government. The Bangalore-based company holds a 77% stake in the international airport through a joint venture between GMR and Malaysia Airports Holdings Berhad.

Once upgraded, Male airport is expected to handle traffic of over 3 million passengers by 2014, and thereby increasing traffic by a further 2 million in the recent future. Currently, the airport handles 2.6 million passengers annually.

GMR has raised debt of $358 million from Axis Bank, Singapore branch, the sole underwriter and mandated lead arranger for the entire debt facility. The debt has a door-todoor tenure of 12 years with ballooning repayments over seven years, commencing from June 2015.

Ramky Infrastructure bags two road projects worth Rs.2,240.65 crore

MUMBAI: Ramky Infrastructure Thursday said it has bagged two road projects worth Rs.2,240.65 crore from the National Highways Authority of India (NHAI).

The first project is for six-laning of the Agra-Etawah bypass section of National Highway (NH)-2 under the National Highways Development Project (NHDP) Phase V in Uttar Pradesh, the company said in a regulatory filing.

The second project is for four-laning of the Hospet-Chitradurga section of NH-3 in Karnataka under NHDP Phase III, it added.

The estimated costs of the projects are Rs.1,207.00 crore and Rs.1,033.65 crore, respectively. The concession period for the first project is 30 years and for the second 25 years. Both the projects include a construction period of 910 days each.

At the Bombay Stock Exchange, the shares of the company closed 4.75 per cent up at Rs.215.

FDI breathes new life into shelved projects of DLF, Unitech, Oberoi Realty and others

NEW DELHI: Despite intensifying political opposition in several states to the centre's nod to foreign direct investment in multi-brand retail, real estate developers are gearing up to fast-track their investments in shopping malls.

India's largest real estate developer DLF is re-evaluating its plan to build 4.5 million sq ft Mall of India in Gurgaon, a project that it had shelved following the global economic meltdown in 2008.

Similarly, other real estate developers are also looking to cater to demand from foreign retailers that have been waiting to set up shop in India. According to global consultancy Ernst &Young, the Indian retail market is expected to grow from $400 billion in 2010 to $700 billion by 2015.

With the easing of FDI norms, analysts expect the share of organised retail to rise from the current 5%-6% to about 10% over the next five years, spelling opportunity for real estate developers. DLF is planning to invest close toRs 2,500 crore over five years to develop malls across the country.

It is also planning retail complexes in its residential and commercial properties in Kolkata, Bangalore, Kochi, Goa, Chennai and Hyderabad. Unitech has lined up an investment of Rs 4,000 crore over the next four years to develop 13 malls across the country. "The demand for quality retail real estate will certainly grow as more and more players will invest in this sector," said Munish Baldev, the company's retail head.

"Mall development is very capital-intensive and companies with a strong balance sheet will be able to take advantage of the situation," said Vikas Oberoi, managing director of Mumbai-based Oberoi Realty, the only real estate developer which has a debt-free balance sheet with Rs 1,400 crore cash in hand. Bangalore-based Nitesh Estates recently started construction activity for its 1.3 million sq ft mall in the city centre in anticipation of the opening up of FDI, said managing director Nitesh Shetty.

The company will invest Rs 1,500 crore over the next three years to develop malls in Kochi and Chennai, along with Bangalore. "When foreign players come in, we will be able to fill up a large mall better. Today it doesn't make sense to make a big mall," said Kishore Bhatija, director and chief executive officer of Inorbit Malls, a part of Mumbai-based real estate developer K Raheja Corp.

Escorts Construction Equipment eyes land in Gujarat and MP for manufacturing unit

BANGALORE: Escorts Construction Equipment (ECEL), the fully owned equipment arm of the Rs 3,000-crore Escorts Group, is in talks with the governments of Gujarat and Madhya Pradesh to acquire land for a manufacturing unit.

Escorts will manufacture cranes, backhoe loaders and excavators at the proposed plant, which will have an installed capacity of 50,000 units. The company refused to share investment details but industry sources said Escorts will invest over Rs 5,000 crore.

Madhya Pradesh is currently the frontrunner for the proposed plant, a company executive said on condition of anonymity. Escorts has zeroed in on the two states because of logistical convenience, huge vendor base and availability of huge land parcel.

"We will require 40 acres of land and are currently negotiating with state governments. The decision will depend on the facilities the state governments offer," said Rajesh Sharma, vice-president, sales and marketing, ECEL. Gujarat and Madhya Pradesh are fast emerging as the favoured investment destination for corporates because of their tax regime and cheap labour. Gujarat has already attracted investments from domestic and foreign automakers.

While Ford and Peugeot have decided to set up manufacturing plants in Sanand, Maruti Suzuki has finalised a deal with the state government to set up aRs 18,000-crore manufacturing facility after production at its Manesar plant in Haryana was hit by a series of labour strikes.

In 2008, Tata Motors moved its production of 'Nano', the world's cheapest car, to Gujarat from West Bengal where it was facing stiff resistance from farmers. In a recent report on India's manufacturing sector, property consultancy firm Knight Frank India said that Gujarat's manufacturing sector is growing at 30% annually and has gained traction from corporates due to faster project clearances.

Separately, the company is also doubling its manufacturing facility at Ballabhgarh, Haryana. "We are operating at full capacity and is de bottling the plant to take up the production capacity to 12,000 units by 2012," Sharma said.

Government wants fresh estimate of RIL's KG-D 6 reserves

NEW DELHI: The oil ministry has asked Reliance Industries ( RIL) to prepare a fresh estimate of gas reserves in satellite fields of the KG-D 6 block and submit a cost assessment for developing the new discoveries, further delaying the $1.5-billion plan to raise gas output by 10 million cubic metres a day.

The proposal, which is awaiting government approval for two years, was discussed on Friday by the block's managing committee comprising oil ministry officials and executives of global oil major BP and Reliance Industries, government and industry officials said.

The relationship between Reliance and the oil ministry has deteriorated after the company slapped an arbitration notice on the government after Petroleum Secretary GC Chaturvedi publicly stated that the ministry may revise the production-sharing contract to penalize Reliance for falling output from the block.

The director general of hydrocarbons SK Srivastava and the oil ministry's joint-secretary for exploration D Narsimha Raju did not attend the three-hour meeting of the management committee. They were represented by their juniors, officials said, adding that the minutes of previous meetings had not been signed.

Sources close to the development said the government sought a fresh estimate because Reliance's proposal was based on prices prevailing in 2008 and officials wanted to prevent a cost review after approval. The development cost in the existing gas field in the block was reviewed, triggering strong comments from the Comptroller and Auditor General.

"After the current controversy over cost escalation and CAG's comments, we want to make sure that estimates of cost and gas reserves are accurate," an official at the directorate general of hydrocarbons (DGH) said. The management committee has asked Reliance to conduct fresh seabed surveys, which the company estimates would cost $30 million, an executive said.

This was expected be on the agenda of the next meeting of the committee, he said. Gas output from the D6 block has fallen to about 42 mmscmd against the target of 80 mmscmd, creating a severe shortage of gas for power, fertilizer and other units, which are being forced to import costly LNG.

ONGC Videsh faces Syria shutdown after European Union blacklist

NEW DELHI: ONGC Videsh, the overseas investment arm of state-run Oil and Natural Gas Corporation, faces the prospect of a near-shutdown of crude production from its field in Syria after the European Union late on Friday night blacklisted that country's oil companies to isolate President Bashar al-Assad's government.

ONGC Videsh is a 33% partner in the Al Furat Petroleum Company, a joint venture that pumps oil from the Al-Furat project and has state-owned General Petroleum Company, which has been blacklisted along with Syria Trading Oil. Agency reports from Brussels quoted Shell as saying the Anglo-Dutch major "will cease activities" in Syria. But ONGC Videsh sources here said that it may be Shell's views and the consortium was seeking legal opinion and examining "all available options".

Along with Shell, ONGC Videsh has China National Petroleum Company and Syrian Petroleum Company as partners. The project has had to reduce production from 82,000 bpd (barrels per day) to 70,500 bpd since September due to problems in finding enough number of ships to carry the crude. The Syrian government had asked all operators in the country to cut production after the initial sanctions since evacuation of crude became difficult as most of the tankers were registered either in Europe or the US.

This is the second time that operations of Indian oil companies are being affected by Western sanctions against various regimes. Earlier, Indian refiners could not make payments for crude after the RBI scrapped a regional clearing mechanism to avoid US sanctions on Teheran affecting other transactions. The payments remained stuck for almost a year since the sanctions also blocked transaction gateways through European banks. Dues were recently cleared through a Turkish bank.

US sanctions have also forced India to pussyfoot discussions on the proposal to lay a $10-billion pipeline to wheel gas from Iran through Pakistan as Indian companies investing such massive amounts would automatically be blacklisted. Friday's sanctions listings of Syrian oil companies are part of a concerted push by Europe, the US and the Arab League to intensify pressure on Assad in response to continued state-sponsored violence against protesters. The United Nations estimates 4,000 people have been killed since March in the unrest.

After ITC closure, Manipal Group warns service halt in Nepal

KATHMANDU: A month after Indian tobacco giant ITC's joint venture in Nepal shut down its garment factory due to workers' militancy, now it is the turn of the Manipal Group, one of the single largest Indian investors in Nepal, to warn that it could suspend its hospital services in view of continued disruptions.

The Manipal College of Medical Sciences run by the Manipal Group in Pokhara city in central Nepal has run into fresh trouble since Sunday with a group of junior Nepali doctors going on strike, alleging discrimination between the pays of local and expatriate doctors.

The strikers refused to attend a meeting called in Kathmandu Monday with the medical regulatory body, Nepal Medical Council, as well as the management and Nepal Medical Association.

The college also runs a 700-bed teaching hospital and despite the strike, the authorities have continued to provide services to patients.

"However, if this continues, I have informed the chief district officer that we will be forced to suspend hospital services," said B.M. Nagpal, dean of the college.

Soon after its inauguration in 1994, the college and hospital has been facing union unrest, illegal strikes and an adverse media campaign.

"The allegations that there is a pay disparity between Indian and Nepali doctors are false," Nagpal said. "We are a business organisation. Why should we employ doctors from outside at a higher pay?"

However, Nepal is still unable to provide the number of senior doctors and specialists whose presence is mandated by the regulator.

"Till that is rectified, we have to get doctors from India," Nagpal said. "And if you get them from outside, you have to pay them an expatriate allowance to cope with additional expenses in a new country. That is the universal accepted norm."

All multinational organisations follow the principle, including the UN and European Union and even the Kendriya Vidyalaya run by the Indian government in Kathmandu.

However, Manipal is being targeted for a smear campaign that says the organisation discriminates against Nepali doctors.

"The strikers are saying expatriates receive higher pay, giving the examples of doctors who were brought from India on contract," Nagpal said. "A contract is not the same as employment. If you don't get the specialists and senior doctors you need in Nepal, you have to get them from outside. And for that, you have to pay them more."

Nagpal points out that Manipal has been grooming its students, training them and absorbing them. Currently, there are 120 faculty members out of whom 52 are from Nepal.

Hospital sources say the strikers have been abetted by the Maoist trade union. In the past, the union triggered cut-throat rivalry among the other trade unions at Manipal, causing frequent illegal strikes demanding pay raises in contravention of agreements signed with the management.

Some of the local doctors have been running private practices in violation of their service agreement and in spite of drawing a non-practice allowance.

The Manipal crisis comes after ITC's joint venture, Surya Nepal, the republic's biggest tax payer, was forced last month to shut down its garment factory in eastern Nepal that produced ITC's John Players and Springwood brands of clothing.

The closure came after militant workers, mostly women, vandalised the state of the art factory and took management staff captive, holding them without food and water for 24 hours.

China would buy large quantity of tobacco from India:Kamalvardhan Rao

GUNTUR: Tobacco Board chairman Kamalvardhan Rao on Tuesday exuded confidence that China would buy a large quantity of the commodity from India.

Addressing mediapersons after his three-day extensive tour of China, Rao said he was happy that China was showing interest in Indian tobacco.

China, which produced 2,300 million kgs of tobacco, needs more of the commodity for internal consumption and Indian tobacco mixes well with their tobacco, he said.

"That is why China prefers Indian tobacco," he said adding, that a Chinese trade delegation would visit India in a couple of months.

Rao said though India exported 800 million kgs of tobacco valued at Rs 4,400 crore in 2010-2011, this year there may be slight decline in the exports.